Computer_lab_1 (1)

xlsx

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Southern New Hampshire University *

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401

Subject

Finance

Date

Jan 9, 2024

Type

xlsx

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19

Uploaded by ChancellorQuailPerson1000

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SINGLE CASH FLOW Inputs Single Cash Flow Discount Rate / Period Number of Periods Present Value using the Formula Present Value Present Value using the PV Function Present Value Problem: Your company has told you that you if you remain employed with them, you will receive a $50,000 bonus four years from today. Assume a discount rate of 8%. Fill in this spreadsheet, calculating the present value in two different ways.
ANNUITY Inputs Payment Discount Rate / Period Number of Periods Annuity Present Value using a Time Line Period 0 1 2 3 4 5 6 Cash Flows Present Value of Each Cash Flow Present Value Annuity Present Value using the PV Function Present Value Compare PV to: Lump sum option Assumptions: For the lump sum option: Use the pretax lump sum am Difference (Annuity PV - Lump sum) For the annual payments option: Use the pretax amo Problem: Kenny Dukes, Lottery Winner. Refer to the newspaper article below to answer the questions.
Source: https://apnews.com/article/469b7ec36de78ed6207402c987179341
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7 8 9 10 11 12 13 14 15 16 17 mount of $16.1 Million ount of $1 Million at the end of each year for the next 30 years and include a $1 Million payment immediately
18 19 20 21 22 23 24 25 26 27 28
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29 30
ANNUITY System of Four Annuity Variables Inputs Payment $576.64 Discount Rate / Month 0.5% Number of Months 60 Present Value $29,827 Payment Payment using the PMT Function Discount Rate / Period Discount Rate / Month using the RATE Function 2019 Audi A3 Number of Periods Num of Periods using the NPER Function Present Value Present value using the PV Function Problem: You're interested in buying the vehicle shown below. The price is $29,827, and you will get a 60-month loan at 6%. All required information is given, but use various Excel functions to solve for the payment, the discount rate, the number of periods, and the present value.
NPV and IRR (in thousands of $) Inputs Discount Rate Period 0 1 2 3 4 5 Cash Flows - $45 $80 $130 $210 $190 Net Present Value using the NPV Function Net Present Value Internal Rate of Return using the IRR Function IRR Problem: An investment of $225 today is expected to bring the future cash flows shown below. Start with a discount rate of 11%.
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Present Value Inputs Payment under revised contract $1,193,248 Discount Rate / Period 8.00% Present Value using a Time Line Period 2000 2001 2002 2003 2004 2005 2006 Cash Flows from current contract Cash Flows from revised contract Present value of current contract Present value of revised contract Difference (current - revised) Problem: Bobby Bonilla, problem player. Refer to the newspaper article below to answer the questions.
Source: https://www.espn.com/mlb/story/_/id/31732959/bobby-bonilla-day-explained-why-mets-pay-119m-tod
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2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
day-every-july-1
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2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028
2029 2030 2031 2032 2033 2034 2035
Lease or Buy Inputs Asset cost Annual lease payment Interest rate Number of years to lease Dell Precision M2300 64-bit Workstation Period 0 1 2 3 4 Buy cash flows Lease cash flows PV of Buy cash flows PV of Lease cash flows Lease or Buy? Problem: You're deciding whether to lease or buy a new computer that your business needs. You can buy it at Dell's price for $1,667, or you can lease it for 4 years (your expected use) for $490 per year, with payments made at the beginning of the year. Should you buy or lease?
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ANSWERS Q1 $36,751.49 Q2 $12,257,783 Q3 The lump sum gives a higher present value. Q4 $18,292,033 Q5 Now the annuity is better. Q6 5.16% Q7 Already given. Q8 Already given. Q9 Already given. Q10 Already given. Q11 $226.61 Q12 37% Q13 $365.99 Q14 Current $5,900,000 Q15 Revised $29,831,205 (Compare to value given in article.) Q16 8% (Compare to rate stated in article.) Q17 $1,609 Q18 Lease Q19 Buy Q20 12%